Tag Archives: FCC

Tomorrow, the FCC will make an announcement that it proposes to implement a new net neutrality rule for the Internet. We had been warned previously that rather than a new Fairness Doctrine, other rules/laws would be passed that could potentially affect content of the Internet and over the airwaves.

Julius Genachowski, chairman of the Federal Communications Commission, plans to propose a new so-called net neutrality rule Monday that could prevent telecommunications, cable and wireless companies from blocking Internet applications, according to sources at the agency.

Genachowski will discuss the rules Monday during a keynote speech at The Brookings Institute. He isn’t expected to drill into many details, but the proposal will specifically be for an additional guideline on how operators like AT&T, Verizon, and Comcast can control what goes on their networks. That additional guideline would prevent the operators from discriminating, or act as gatekeepers, of Web content and services.

The guidelines in place today have been criticized by applications developers like Google and public interest groups for not going far enough to clarify what is defined as discriminatory behavior. Comcast is fighting in federal court an FCC ruling that it violated the guidelines by blocking a video application last year. AT&T and Verizon have said existing rules are sufficient, and more regulation is unnecessary. However, they have also said they wouldn’t fight against an additional guideline that focuses on discriminatory behavior.

Julius is not somebody who is non-partisan either. As any appointees, they have connections to a political party and ideology. Julius was Obama’s communications and Internet campaign manager during the 2008 election. As we have discovered with Mark Lloyd and Cass Sunstein, Genachowski is probably no different.

After reading various comments and arguments for this rule, I can understand how people believe net neutrality would be a good thing. Most people who are unaware think that more regulation will actually help the consumer, and if that truly is the case, I would be all the more for it. However, cable, phone, Internet, and wireless companies are some of the most highly regulated companies in the United States, but people still despise them. Since there is already so much government interference wouldn’t it be safe to say that the government would inevitably make things worse rather than better?

One issue at play is that enterprises like AT&T, Verizon, and Sprint, etc. use “public” airwaves but they pay billions of dollars in licensing fees for the privilege of using the AIR! The government is already regulating that “air” and the argument has to do with the amount of regulation that already exists. To force mobile carriers to treat all internet traffic the same is ridiculous because this kind of free for all will crash many of the major carriers’ networks! There is a natural free market revolution going on which is allowing these private companies to upgrade their networks to meet the demands of their customers. Government intervention is not the answer. AT&T is responding to anger in NYC and SF by adding tons of capacity to meet the needs of its users before they leave AT&T for another carrier. If the government forces net neutrality on wireless carriers, all iPhone and smart phone users will take all of the bandwidth in order to watch streaming video and music, which sounds fine if you are an iPhone user but think about the downside and unintended consequences. If these major wireless carriers are forced to treat all traffic the same there will be no more unlimited data packages for $35/month. They will start to charge per MB in order to ensure their networks dont crash for all of their users. There were no wireless data networks to speak of 10 years ago and now we have 3G and 4G LTE coming everywhere within the next 18 months. The free market is doing this not a govt mandate, unfortunately, what a lot of people have failed to recognize is the reality and universality of the “law of unintended consequences”.

Which brings to the forefront, the second issue: at face value, net neutrality sounds like a great idea. Unfortunately, nearly everything the government does ultimately warps the motives of companies and individuals in a bad way. The presumption by most is that the government actually has the ability to “make things better”. In my experience, that is almost never the case. The slippery slope argument is not fear-mongering, when one merely needs to look back through history to see plenty of laws that were intended for the right purpose, which were used for something incredibly distorted and wrong. The content originally regulated would most likely be something routine and mundane – very basic data, however, it could suddenly change to ideological content. Mark Lloyd has been talking about diversity on the Internet and over the airwaves, as well as anti-discrimination. Sunstein, the newly appointed regulation czar feels the same way and would like to regulate the Internet based on any perceived falsehoods – who decides what is false and what is not – there is too much room for political bias.

If this is implemented officially, I want to hear what those lauding it say after 5 years, and after majorities switch hands to the other party. I better not hear any outcry from the liberals if Republicans come into power and continue to use net neutrality…

On Friday of last week the new FCC Chief Diversity Officer stated that he intended to create a new type of fairness doctrine which would require private radio to fund public radio. Private radio stations would have to pay a fee of 100% of their operating budget to their public competitors who would pay nothing. In essence private radio would pay 2x it’s budget and hope that it makes 201% of it’s original operating budget, which probably will not happen.

An operating budget is usually set based upon estimates that are either from history or known costs that have an 85% chance of occurring. No company expects to make 100% x it’s operating budget, but at least some percentage above their costs/budget that will provide the organization a profit. This new regulation would drive businesses out of the communications/media industry, and I have to believe this is on purpose.

Net Neutrality, the Fairness Doctrine, Hate Crimes Legislation, Localization, Cass Sunstein, who believes in regulating free speech if deemed untrue (by his own opinion), and now a brand new FCC diversity panel that was created right after Obama’s inauguration, will create some type of ban on conservative views one way or another. A new type of fairness doctrine will be created, it will just be under another name. It will be one of those alternatives that tricks people through semantics as Saul Alinsky stipulates in rule 12.

Mark Lloyd, newly appointed Chief Diversity Officer of the Federal Communications Commission, has called for making private broadcasting companies pay licensing fees equal to their total operating costs to allow public broadcasting outlets to spend the same on their operations as the private companies do.

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“Federal and regional broadcast operations and local stations should be funded at levels commensurate with or above those spending levels at which commercial operations are funded,” Lloyd wrote. “This funding should come from license fees charged to commercial broadcasters. Funding should not come from congressional appropriations. Sponsorship should be prohibited at all public broadcasters.”

Along with this money, Lloyd would regulate much of the programming on these stations to make sure they focused on “diverse views” and government activities.

I also wonder if many have heard of the performance tax? This is another idea coming out of Washington in connection with the record label companies that would require local radio stations to pay a tax on any and all music played. Many radio stations play a variety of music, provide local traffic updates, news, and other information, all of which could find itself on the chopping block if this tax is passed. It’s estimated that this tax would cost local radio stations anywhere from $2-7B annually. Radio stations already pay fees to purchase music, as well as use online streaming, but record labels are not satisfied because they are still seeing a decline in their sales now that everything has gone digital.

In short, the money would flow out of your community and into the pockets of the record labels – the great majority of which are foreign-owned. The record labels would like for you to think this is all about compensating the artists, but in truth the record labels would get at least 50% of the proceeds from a tax on local radio.

This is beginning to sound more like that wonderful idea; cash for clunkers. I thought we were supposed to pump money into our own economy and not into foreign ones to see a real recovery? So I was curious to see what party was looking to levy this tax on our radio stations – it comes as no surprise that the tax and spend party and the party who is backed by the liberal music industry believes this performance tax to be a good idea. But I must give credit to several Democrats and the Republicans who are attempting to stop this idea from passing:

There are currently two bills pending in Congress that would levy a performance tax on local radio – H.R. 848, sponsored by Rep. John Conyers (D-MI-14) and S. 379, sponsored by Sen. Patrick Leahy (D-VT). Your members of Congress need to hear that you strongly oppose these bills.

Additionally, anti-performance tax resolutions have been introduced in the House and Senate in support of local radio. In the Senate, Sens. Blanche Lincoln (D-AR) and John Barrasso (R-WY) introduced S. Con. Res. 14, and in the House, Reps. Gene Green (D-TX-29) and Mike Conaway (R-TX-11) introduced H. Con. Res. 49. Both are known as the “Local Radio Freedom Act.” Encourage your senators and representative to cosponsor these resolutions.